Arctic Cat Sales Up, Earnings Down

Arctic Cat Inc. reported a net loss of $592,000, or $0.03 per diluted share, for its fiscal fourth quarter ended March 31, 2006, down from net earnings of $2.7 million, or $0.13 per diluted share, in the same period last year. The company’s fourth quarter net sales were $153.3 million, down from sales of $157.0 million in the prior year fourth quarter.
For the year ended March 31, Arctic Cat net earnings totaled $23.7 million, or $1.20 per diluted share, down from $28.3 million, or $1.36 per diluted share, for fiscal 2005. However, the company posted its sixth consecutive year of record sales with consolidated net sales of $732.8 million, up from $689.1 million last fiscal year.
Arctic Cat’s fourth quarter results were severely impacted by a drop in snowmobile sales, which totaled $140,000 versus $10.9 million in the prior-year quarter. Arctic Cat’s 2006 fiscal year snowmobile sales totaled $238.1 million, down from $252.5 million in the prior year.
Arctic Cat’s fourth quarter ATV sales were $126.8 million, up from $117.1 million in the same period last year. For fiscal 2006, ATV sales reached $394.9 million, up from $341.0 million last year.
Fourth quarter sales of parts, garments and accessories were $26.4 million, down from $29.0 million in the year-ago period. For the full year, sales of parts, garments and accessories totaled $99.8 million, up from $95.7 million last year.
“Our performance in fiscal 2006 was mixed, despite the fact that we posted another year of record sales,” said Christopher A. Twomey, chairman and chief executive officer of Arctic Cat. “While our ATV sales grew, our fourth quarter results were negatively affected by poor snowfall in the East and Midwest that reduced sales of snowmobiles and snow-related parts, garments and accessories, coupled with increased sales incentive programs on snowmobiles and ATVs.”
In related news, Robert Bonev, Arctic Cat’s vice president of sales and marketing, has departed the company.
Bonev became the Minnesota-based powersports manufacturer’s vice president of marketing in 2001, replacing Mark Blackwell who left Arctic Cat to become general manager of Polaris Industries’ Victory motorcycle group.
Bonev reported directly to Arctic Cat President and CEO Christopher Twomey. Bonev is a former senior vice president of corporate marketing for Outboard Marine Corporation, and also served as vice president of sales and marketing for Continental Motors, a division of Allegheny Teledyne.
“We appreciate Robert’s contributions during his tenure at Arctic Cat and wish him well in his future endeavors,” said Twomey. Until a successor is named, Twomey said marketing will be under his direction. “During this interim period, we have an experienced team in place to ensure a smooth transition.”